Why Ignore Hospital Operations?

In a September 21 article, New York Times reporters Reed Abelson, Julie Creswell and Griffin J. Palmer say the move to electronic health records may be contributing to billions of dollars in higher costs for Medicare, private insurers and patients.

Critics conclude that EMRs make it easier for hospitals and physicians to bill more for their services whether or not they provide additional care because of the way billing codes have changed and enable fraud through EMR-assisted cloning and upcoding. Hospitals and physicians counter that the increases reflect more accurate charge capture for services and that patients (older and with more co-morbid conditions) require more care than in past years.

Regardless of whether you believe EMRs help or hurt healthcare costs, we wonder why the operational side of healthcare is largely ignored? There is no controversy in the statistics of hospitals which have adopted industry-style capacity management systems and have dramatically reduced overcrowding, improved operational efficiency and resource utilization, cut costs and enabled better access to care in the communities they serve.

It does seem the healthcare community is starting to take notice of this other side of avoidable waste. The Institute of Medicine recently issued a report, Better Care at Lower Cost, confirming that healthcare needs to adopt lessons from industry, such as automation, in order to reduce “waste,” which accounts for $765 billion going down the drain annually – with an estimated $130 billion of that attributed to inefficient operations and medical errors. [See our earlier post Healthcare Reform: Delivering Best Care at Lower Cost for more on the IOM report.]

With waste in the form of inefficient operations being one of the biggest problems facing our healthcare system, we wonder why more attention isn’t given to available technologies and techniques which have been proven to improve operations and substantially reduce costs.

Do you have any ideas why?